Home Care and Hospice Deals Fall in Third Quarter

Despite a rising number of healthcare deals in the third quarter, home health and hospice lagged the remainder of the health care services market, falling 44% year over year. 

Health care mergers and acquisitions increased at a rate of 13% year over year with long-term care services mergers outpacing that average at a rate of 18%, according to the latest data compiled by Levin and Associates. 

Levin tracked five home health and hospice deals in the third quarter of 2013, down from nine deals in the third quarter of 2012 and falling by five deals from the previous quarter. 

Long term care was “among the dominant sectors” tracked by Levin, said editor of Health Care M&A News Lisa Phillips in announcing the findings. 

“As the Affordable Care Act gets closer to full implementation, the M&A market seems to be picking up steam,” she said. 

On contrast to the long term care market, home health and hospice saw far fewer deals, counting five deals total during the third quarter, down from 10 deals in the previous quarter and 9 deals in the third quarter of 2012. 

The number of health care deals has increased, Levin found, though the market value of all deals is declining as the fourth quarter and end-of-year approaches. 

“We expect to see even more M&A activity in the fourth quarter,” Phillips said. “Now that the Affordable Care Act is poised to take full effect in January, the uncertainty felt in many sectors is starting to dissipate. Health systems that have made strategic acquisitions such as physician medical groups will now turn their attention to long-term care, home health care and rehabilitation to fill out their care continuum requirements.”

Written by Elizabeth Ecker

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